The Effects of International Financial Reporting Standards on Financial Reporting Quality

Wafaa Salah and Abdallah Abdel-Salam

Athens Journal of Business & Economics, 2019, vol. 5, issue 3, 221-242

Abstract: The purpose of this study is to investigate whether the financial reporting under International Financial Reporting Standards (IFRS) has more quality than local GAAP for firms listed on Taiwan stock exchange. Financial Reporting Quality is measured in this study by three attributes of earnings introduced in previous literature, namely: 1) earnings management expressed as managing towards positive earnings and earnings smoothing and, 2) timely loss recognition expressed as the asymmetric incorporation of economic gains and losses and large negative net income, and 3) value relevance. Ordinary Least Square (OLS) Regression analysis, Ztest, and Binary Logistic Regression are employed to investigate the pre-IFRS (2008- 2010) and post-IFRS (2012-2014) adoption periods on value relevance, earnings management, and timely loss recognition. The study employs a sample of 426 manufacturing firms from 8 industries listed on Taiwan stock exchange. The study finds that firms adopting IFRS evidence less earnings smoothing. However, there is no significant difference in either the timely loss recognition or the value relevance of accounting information between the pre and post-adoption periods. This study contributes to the literature by using data from an emerging market. It provides an insight to practitioners, international standard setters and regulators into the international debate on the effects of the switch from local GAAP to IFRS on Financial Reporting Quality.

Keywords: Bhoodan-based corporate citizenship (BbCC); land acquisition for commercial purposes; India; servant leadership; social entrepreneurship; spontaneous land transfers (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.athensjournals.gr/business/2019-5-3-3-Salah.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ate:journl:ajbev5i3-3

DOI: 10.30958/ajbe.5-3-3

Access Statistics for this article

More articles in Athens Journal of Business & Economics from Athens Institute for Education and Research (ATINER)
Bibliographic data for series maintained by Afrodete Papanikou ().